The Pre-nup – Necessary in the UK?

February 14th 2018

The Pre-nup – Necessary in the UK?

Although it might not sound very romantic, many people are now considering Pre-nuptial Agreements when entering into a marriage. This is particularly popular amongst people who are perhaps entering into their second marriage, having previously felt they came out badly from their divorce and wanting to protect the assets they have acquired. Similarly, there are those who marry later on in life and want to protect family money or property that was inherited, or may be inherited.

The UK has traditionally had a confused and uncertain relationship with prenuptial agreements. Until very recently, the UK courts did not recognise Pre-Nuptial Agreements on divorce and the position has been, traditionally, confused and uncertain. However, in 2010, the Supreme Court took the opportunity to clarify the law in the case of Radmacher v. Granatino. The result of this and subsequent court decisions is that the British courts have to give weight to the existence of a Pre-nup and are much more open to enforcing them than in years gone by. This position is now much more in line with that of Separation Agreements, which courts have been giving significant weight to for many years.

As things stand, whilst the UK courts are not bound to follow any nuptial agreement when considering how assets should be divided on divorce, it will be difficult for a court to justify departing from the terms of a properly drawn up agreement provided that it is fair in the circumstances of the case. Pre-nups are, therefore, the best way of legally shielding non-marital assets from being divided between the parties on divorce.

The key is to make sure that the agreement complies as much as possible with what the UK courts expect, something that most people can’t do without legal advice. If you’re considering a pre-nup for your relationship then there are a few key points to note.

Take independent Legal Advice

It is important that both you and your future spouse take independent legal advice concerning the terms of a pre-nup. The courts have picked this out as one of the things that is preferred and which will make the agreement more likely to be enforced on divorce. If there is evidence that one party was discouraged from taking legal advice, and did not understand what they are signing, the court might ignore the agreement when deciding how the assets should be divided on divorce. It is important that neither party is put under undue pressure to sign the agreement as this may invalidate the agreement and if they both have independent legal advice this should ensure that allegations of undue pressure are avoided.

Your pre-nup must be specific

There is little point in printing a generic document you’ve found online and attempting to use this for your own individual situation. There is no one agreed form of agreement and nobody’s circumstances are the same. You may have assets that could be difficult to split, inherited property you want to protect, a business you want to remain in control of or children or ex-spouses to take into account. All of these can create problems in the future and make the wording of the agreement more difficult. A pre-nup is a tailor-made document which will be different for everyone and is best drawn up by an experienced family lawyer.

Fairness is a key consideration

Ensuring that a pre-nup is fair is not that simple given that everyone’s idea of what is ‘fair’ can be different. However, it is possible to avoid the most obvious pitfalls of unfairness by working with a lawyer. For example, if one party were to be responsible for drawing up the pre-nup it would most likely be weighted in their favour, even if this was a subconscious choice. An experienced family lawyer can provide an objective opinion as to what the courts might expect and what is likely to be considered fair and reasonable. You should try and sit down with your future spouse and discuss why you want a pre-nup, how it might benefit both of you and what terms you would each find acceptable. Such negotiations could take place with your respective lawyers.

One way which may be less confrontational is to use the Collaborative approach, where both parties have a round-table discussion with their collaboratively-trained lawyers present and try to reach an agreement which is fair and reasonable to all parties. In this way it might be possible to reach a compromise which benefits the family as a whole, rather than seeming to just benefit the one who holds the most wealth.

Ensure you have made full disclosure of your assets

It is important that both parties to a pre-nup give full details of their financial and other relevant circumstances before a pre-nup is agreed. It is usual for this to be recorded in the document in the form of a summary of the assets, incomes and liabilities. Failure to do this could result in the agreement being set aside at a later date.

Timing is important

You should allow plenty of time for your solicitor to draw up the agreement, check it with you and send it to your future spouse. They should be allowed time to consider the document, which may be lengthy and complicated, and take legal advice on it if they wish to. Ideally, the agreement should not be signed less than 4 weeks before the wedding. If the agreement is made within 4 weeks before the wedding the court may consider that the weaker financial party was under too much pressure to sign to have made an informed decision.

Plan for the future

It is important to remember that peoples circumstances can change over time and this can affect whether or not the agreement is fair. It is advisable to review the terms of the pre-nup when there is a change of circumstances, such as the birth of a child or a long-term illness or health condition.

Clarity now will protect future relationships

A well-prepared, clear and fair pre-nup can help ensure that, if the marriage does breakdown, then the separation and financial arrangements can at least be sorted out in as quick and amicable way as possible, at a time when emotions may be running high and money may be tight. Without a pre-nup, relations can dissolve into angry fighting and bitterness that can take months, or even years, to resolve – often at great expense. Working with solicitors to create a clear and unambiguous pre-nup now could save a lot of time, money and heartache in the future.

If you are considering entering into a pre-nup and would like to speak with our Family lawyer, you should call 01539 723757 and ask to speak with Andrew Hill.